Financing difficulties have delayed a project by the nonprofit PLACE yet again.
The group, whose name stands for Projects Linking Art, Community & Environment, had agreed to buy some of the city land needed for the major mixed-use project last year.
However, the St. Louis Park Economic and Development Authority, made up of council members, granted an extension on buying all of the city land needed for the project until April 30.
At the time of the extension, a city staff report said the Tax Cuts and Jobs Act had created uncertainty about whether the private activity bonds and low-income housing tax credits PLACE had planned to use to finance the project would be available.
The legislation ultimately kept private activity bonds, which provide tax-exempt financing at lower-than-typical interest rates, and low-income housing tax credits generally the same. However, analysts have indicated that other aspects of the law do affect developers of affordable rental housing.
Economic Development Coordinator Greg Hunt said during a May 7 meeting, “PLACE encountered unavoidable delays in meeting the closing requirement.... This was due to the passage of federal tax legislation, which subsequently resulted in delays in obtaining project financing.”
The authority voted at the meeting to extend the closing dates to Friday, June 15, for city-owned parcels on the north part of the site, near Highway 7 and Wooddale Avenue, and to Wednesday, Nov. 21, for south parcels near 36th Street and Wooddale Avenue.
The authority also changed the agreement to state that PLACE has opted for an alternate financing model that changes the affordability of the apartments. A previous plan had anticipated that all 152 units on the north part of the development would be affordable to residents making up to 60 percent of the area median income. The new plan calls for 22 of the units to be affordable to residents making up to 50 percent of the area median income. The other 130 apartments essentially would be more expensive, with rates considered affordable to residents making up to 80 percent of area median income.
PLACE has agreed to buy the land from the authority for more than $6.2 million, plus administrative costs.
The council approved the overall project after years of study, but the project has been slow to take shape despite the demolition of a former coffee factory on the site.
“We have spent many years working on this project in partnership with the developer,” Councilmember Anne Mavity.
She said the affordable housing world in general has faced similar challenges. Mavity is executive director of the Minnesota Housing Partnership, an affordable housing support organization.
“While we do want a speedy move toward construction beginning, I would move approval of this to facilitate that,” Mavity said.
The entire project, now dubbed Via Sol for the north section and Via Luna for the south side, would straddle the planned Southwest Light Rail Transit line. In all, it would include 299 apartments, a hotel with 110 rooms, more than 16,000 square feet of commercial spaces and an anaerobic digester that would provide renewable energy.